$100 Million Gift to Benefit Central Park

By

Michael Howard Saul

Updated Oct. 23, 2012 11:17 p.m. ET

Hedge-fund manager John Paulson pledged a $100 million gift to the Central Park Conservancy on Tuesday, in what officials described as the largest donation to any public park and one of the most generous to any cultural institution in the city.

"Central Park's significance to New York City cannot be overstated," Mr. Paulson, 56 years old, said as he stood with Mayor Michael Bloomberg in front of the Bethesda Fountain. The billionaire investor hailed the green space as "the most democratic" city institution "open to people of all ages, all income levels, every race, religion and nationality. It's open every day and all day…and it is free."

The donation from Mr. Paulson and the Paulson Family Foundation will be delivered over a five-year period, beginning with $60 million early next year. The balance will come in installments of $10 million over the following four years.

Half of the gift will be committed to the Central Park Conservancy's permanent endowment, which now stands at $144 million. Founded in 1980 to restore the 843-acre park after decades of neglect, the nonprofit organization provides 85% of the park's $46 million annual operating budget.

Mr. Paulson's gift will help fund two key projects: the restoration of the North Woods and an upgrade to the landscaping surrounding Merchants' Gate near Columbus Circle.

Park officials are also planning to tap the funds to pay for the refurbishment of all 21 playgrounds; improvements to Conservatory Garden and the Ramble; and upgrades to the Tennis House and visitor bathrooms.

The gift will "touch literally every acre of the people's park," said Doug Blonsky, the conservancy's chief executive. "John is a man who knows a good investment when he sees one."

Officials said no decision has been made on how the money will be managed, and it was unclear Tuesday whether Mr. Paulson or his company would be tapped to oversee the funds. The conservancy declined to say whether Mr. Paulson, who became a trustee this year, is managing any of its money.

The conservancy doesn't disclose the details of the management of gifts, an official said.

Mr. Bloomberg acknowledged that some grand city parks are more apt to attract private donations. But he said the city has been committed to all its parks, and the imbalance in private giving won't affect how the city allocates taxpayer funds.

Mr. Paulson's gift "doesn't mean we're going to transfer any moneys from one place to another," Mr. Bloomberg said.

Still, Holly Leicht, executive director of New Yorkers for Parks, said she believes Mr. Paulson's donation is good for all parks.

"Hopefully, it will inspire some other gifts," she said.

Central Park draws more than 40 million visitors a year, and the conservancy has 300 employees and 900 volunteers. According to tax returns filed last year, Mr. Blonsky earned nearly $500,000. Eight other staffers earned more than $150,000.

A native of Queens, Mr. Paulson said his parents rolled him through Central Park in a carriage. According to family lore, his grandparents held hands in the park on their first dates.

These days, Mr. Paulson can be found cycling and running in the park or taking his children on the carousel and rowboats.

He was ranked No. 61 on the 2012 Forbes list of the world's wealthiest people, with a net worth of $12.5 billion.

Mr. Paulson rose to fame for his bets against subprime mortgages during the financial crisis, notching billions of dollars in gains for himself and his firm, Paulson & Co., and stature as one of Wall Street's most lionized investors. In 2007 alone he personally pocketed $4 billion.

He extended his winning streak by getting bullish on stocks in early 2009. And he poured money into gold before it climbed, resulting in a payday of about $5 billion in 2010.

Investors plied Mr. Paulson with cash, helping to bring the New York firm's assets under management to a peak of $36 billion at the start of last year.

But amid subsequent losses at his funds—among last year's worst performers, according to investors—some clients have pulled out, and one former investor is suing over a losing bet on a Chinese forestry company.

The firm's assets had fallen to about $19.5 billion as of August, with the majority of the money Mr. Paulson's and his employees.

A person familiar with Paulson & Co. said in August that some existing clients were looking to increase the amount of money they had with the firm and that the firm had also been contacted by new investors.

Most of Mr. Paulson's funds posted gains in September amid more stable market conditions and a rally in gold prices. Still, his two largest funds remain in the red.

The Advantage Fund, which posted losses of 36% last year, was down 10.5% through September. The Advantage Plus Fund, which lost about half its value in 2011, was down 14.4%.

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